ITL #683 Spotting red flags: PR professionals should be board members

2 hours, 49 minutes ago

Reputation management and risk spotting expertise is needed in the age of AI. By Sandra Sinicco.



Ten years ago, I wrote an article saying that PR professionals had the opportunity to be essential board members because their unique skills enable them to identify red flags arising from the disconnection between corporate values and the reality of ground operations. Additionally, I argued that they have a unique understanding of public brand perception and the need to develop additional measures to integrate values into day-to-day procedures.

Nowadays, in the era of AI dissemination, the need for this skillset couldn’t be more urgent. 

PR professionals are often seen as second-tier members of the company, especially compared with the hierarchy of investors, CEOs, board members, and consultants. For that reason, boards are commonly comprised of professionals with extensive experience in finance and accounting. Recent research shows that fewer than 5% of Boards have a PR professional acting as a Board Member.

Today, boards are facing daily new challenges like never before. 

They face consistent market pressure to embed AI in their companies to increase competitiveness. But we need to consider that there is a level of risk and generating problems that can, by far, surpass the advantages of the solution in some cases. 

Introducing AI into an organisation's operational system is not easy. Risks come from all sides - be it the technology's own flaws or the limited accuracy of the companies’ own databases, which will be the basis for internal AI to generate suggestions, information, and so on.

The step-by-step introduction of AI into the daily operations of brands and companies raises concerns about the need for ethical guardians of the brand. 

Why are they necessary? 

Because without this overview, the databases alone will serve as the foundation for AI to operate, thereby risking the dissemination of biases from previous content processed by the engine. The only way to minimise the risk of any kind of discrimination by AI tools is to introduce guardrails that highlight red flags to HR, Communications, and Finance departments, among others. 

IPRA Gold Paper

IPRA has published a Gold Paper on Ethical standards and guidelines for the use of Artificial Intelligence in public relations. It underlines the importance of GDPR rules and transparency, as well as explainability, when adding AI to a corporate environment.

This is mandatory, but when introducing AI projects, we know that the points and counterpoints need to be balanced in order to make a coherent decision that aligns with the company's values.

In this area, I see PR strategists as extremely relevant, and they can add immense value by serving on Boards as members, in order to pose the right questions before a crisis emerges. 

 

A crisis caused by AI

To give an example: there was a sales platform [due to ethical reasons I can't disclose their brand] that decided to introduce AI in their sales algorithm by providing different prices according to the region of the consumer or even the social class. They based their decision on research that showed that lower income consumers very often like to pay in instalments, opting for “buy now, pay later” offers, and that they didn't pay attention about the price comparison.

With this in mind, the commercial team presented the new strategy to the CEO, who presented it to the Board, and this new commercial policy was approved without question.

Turns out that a consumer did compare prices and realised that prices for the same product varied by customer address. The consumer denounced the practice to the relevant government institutions, which then sued the company.

The brand damage was huge. People started to distrust the platform, and churn rose significantly. This situation could have been avoided if someone on the Board had flagged the question of whether this was a reasonable practice for a brand that always boasted of being a trustworthy platform for the best prices and product quality.

All these consequences occurred because the Board reviewed the financial results of this change in commercial policy but didn't consider the ethics of the decision.

The failure to uphold the brand values led them to lose significant money and reputation within two weeks.  This is just one example of the fast pace we can expect in AI times.

Just flagging concerns will not be enough. PR professionals will need to be trained to understand the evolution of AI and to learn the Dos and Don'ts each company will have to commit to.

A core value

Ethics in the AI era is rising as a core value that brands will need to be aware of and follow closely. It is not about making lofty promises with beautiful words and images. This commitment will need to be real and present in the day-to-day, in the form of guardrails (which will need to be revised regularly). It will also require a commitment from Boards, CEOs, and middle management to disseminate rules that must be followed to avoid creating vulnerable spots for a crisis that could act as a fire in the market.

When I mention defining values and being clear about them, I mean questions that go deeper. Like, are we going to use AI to replace our photographers, designers, artists, and have something “cool” to show, but that has nothing to do with real life and the commitment to the creativity of these kinds of professionals? Are we going to select people by using AI in our HR department without checking all the previous biases? Are we going to introduce AI to keep our machines running until the last minute of maintenance to avoid extra costs, only to face the challenge of having to stop production due to excessive stress on the machinery's materials? 

These and thousands of other questions have to do with ethics.  And PR professionals are some of the most skilled advocates in this field. 



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The Author

Sandra Sinicco

Sandra Sinicco is an entrepreneur and executive in the fields of communication and soft landing for Latin American and international companies in Brazil. With a focus on innovation and environmental sectors, she leads two companies: Grupocasa and LatamScaleup. Through LatamScaleup, she is currently leading the soft landing operations for three companies: Prudent (India - WABA VOICE/META), Waymap (UK), and Pulpou (Argentina).

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